Private Student Lending

Next Student a leader in the student loan industry recently informed some partners they would be unable to pay them. In a private email from one of these partners forwarded to PrivateStudentLending.com, NextStudent.com manager of Accounts Payable, Karen Woollums stated

Unfortunately, we are not in a position to make payment at this time. We value our relationship with you, and are doing everything we can, to get you paid as soon as possible.

NextStudent.com operates as a student loan brokerage selling the majority of their loans directly to Lehman Brothers owned Campus Door. Perhaps the fact that Campus Door Recently tightened their credit critiera, thusly reducing the amount of eligible borrrowers somehow played into the cash flow difficulties being experienced by NextStudent.com.

The credit crunch that hit the student loan industry late last year played an integral part in Astrive parent company First Marbleheads’ filing for bankruptcy and seeking out Suntrust to step in to underwrite and fund Astrive Student Loans. The crunch has hit every corner of the industry causing major banks like Bank of America to non-bank lenders such as GMAC to pull out of the retail side of the industry altogether.

What’s next for Next Student? If they are unable to pay their vendors for servcies rendered, what is the next logical step? Being unable to pay employees and when that happens, when will the employees stop showing up to work? Once the employees are gone who will originate the loans that are keeping the doors open? Who will be the point of contact for the students with loan applications in process?

At this time, PrivateStudentLending.com strongly suggests any student or parent considering obtaining a loan or with a loan in process immediately re-consider and seek information about potential lenders from sources such as Student Loan Consultants which provides links and detailed information about many student loan lenders.

During this continuing credit crunch that has seen major and minor lenders alike pull out of the student lending market, we encourage all potential student loan borrowers to apply with at least 3 lenders that fit their financial needs. This provides a backup solution should one of the lenders you’ve chosen unexpectedly disappear from the scene.

We will keep on this breaking story and update as information is made available.

PrivateStudentLending.com has been notified that Astrive, the well known and publicized private student lender has temporarily stopped accepting new loan applications.

The company has posted that they are in the process of upgrades to the application process and product line. During this time those students who already have an application submitted may contact Astrive at 866-463-9599 to check on your loan status.

Students who are attending summer semester or trying to get a jump on their fall education expenses may apply for a private student loan through either Student Loan Advisors or Chase Student Loans. Both companies are accepting new private student loan applications.

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Being one of the most aggressive advertisers in the student loan industry, you’d think the marketing department at Astrive Student Loans would jump at a chance to have a free review posted about them on a private student loan site. You would think wrong.

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